18. Converting and redesigning
manual processes and procedures so that they can be done electronically
should provide opportunities for departments to improve their
operational efficiency with potential to release resources from
support activities for front line service delivery. Few departments
have as yet full information on the cost of completing basic administrative
tasks to assist in determining the scope for efficiency savings
which converting to electronic means of working should allow.
19. The Comptroller and Auditor General's examination
of Customs and Excise's development of electronic services provided
some indication of the potential savings that should be achievable.
For example, the average cost of processing a combined VAT return
and cheque under current manual systems is £1.16. Private
sector experience suggests that the processing of similar transactions
electronically should typically cost less than 10 pence. Applying
these figures to the 7 million VAT transactions which Customs
and Excise process each year suggested that there would be significant
savings if the Department could encourage substantial numbers
of businesses to submit their VAT returns online. Customs
and Excise also identified an average 240,000 errors each year
in the submission of VAT Export Sales Lists from businesses. Each
error cost £1.50 to correct (around £360,000 a year).
There was therefore potential to realise savings if lower levels
of error could be achieved by businesses directly inputting information
via the Web.
20. Customs and Excise had achieved only modest efficiency
savings from moving to Internet-based services largely because
take up of services by businesses had been low. It was only by
persuading sufficiently large enough numbers of people and businesses
to switch from sending returns in by post to doing so online
that more labour intensive manual processing could be reduced.
21. The Office of the Deputy Prime Minister was supporting
a number of projects to promote improvements in value for money
in local authorities. This support was mainly for authorities
which were taking the lead in developing, for example, electronic
procurement or electronic customer management systems. The intention
was to have all purpose systems which were capable of being transferred
to other authorities at a cost significantly less than if they
had had to employ consultants to develop similar systems from
scratch. It would be possible to point quite rapidly to areas
of local government where substantial savings would be being achieved.
22. The Office of the eEnvoy had not yet implemented
the recommendation in our previous Report on the need to develop
a methodology for justifying expenditure on Web provision. Asked
how it could be confident that expenditure on implementing electronic
government was delivering value for money, the Office said that
the Treasury would be issuing guidelines on applying such a methodology.
Before any significant sums could be spent on IT projects departments
had to present a business case to the Treasury setting out the
intended benefits to be achieved from the investment in IT including
savings to be realised.